Robotic Machines Are Creating New Manufacturing Realities

To mark the opening of the Consumer Electronics Show in Las Vegas, an Audi A7 Sportback made what the company claimed was the longest-yet autonomous trip by an automobile—about 500 miles from Stanford University to CES. It was only the latest display of the tremendous capabilities of machines to mimic the human mind and, in the process, transform manufacturing and the rest of business.

Manufacturing CEOs increasingly will have to make decisions about how to produce goods in a world where artificial intelligence and robotics present greater and greater capacity to handle automated tasks, and humans are being freed up to handle more consultative or custom roles. But will there be enough jobs?

Unfortunately, some experts in the field are even suggesting that the time has come where technology is actually destroying more jobs than it is providing. “This isn’t some hypothetical future possibility,” Lawrence H. Summers, former Treasury secretary, told The New York Times. “This is something that’s emerging before us right now.”

“In the face of the inexorable ‘rise of the machines,’ some say the nature of work will need to change.”

There is greater concern than ever about the effects of automation on human employment for a number of reasons. First, artificial intelligence “has become vastly more sophisticated in a short time,” as the newspaper noted, with machines now able to learn, not just follow programmed instructions, and to respond to human language and movement.

Second, American workers gaining new skills slower than ever and are doing so at a slower rate than in many other countries, no doubt a reflection of the decline of the U.S. education system, among other factors. So while Americans between the ages of 55 and 64 are among the world’s most skilled workers, according to a recent report from the Organization for Economic Cooperation and Development, younger Americans are closer to average age among the residents of rich countries—and below average by some measures.

Because of this reality, manufacturing chiefs continue to face a sometimes-acute shortage of skilled workers for their U.S. operations. In turn, this scarcity affects their companies’ decisions about expanding output or siting new production. “Availability of skilled labor” has risen to the No.1 concern of site selectors in the latest annual survey of the industry by Area Development magazine, up from No. 8 in 2007.

Third, manufacturing CEOs are facing the fact that more workers are feeling threatened by technology. About 37 percent of Americans between the ages of 25 and 54 who were not working but said they wanted a job cited technology as a reason they didn’t have one, in a recent poll by the Times, CBS News and the Kaiser Family Foundation. Even more—46 percent—cited “lack of education or skills necessary for the jobs available.”

Furthermore, the encroachment of machine capabilities is affecting white-collar as well as blue-collar jobs. In professions ranging from piloting an airplane to designing software to, as we stated earlier, driving a car, automated functions increasingly are taking over.

In the face of the inexorable “rise of the machines,” some say the nature of work will need to change, the Times reported. Google co-founder Larry Page, for instance, recently suggested a four-day work week so that as technology displaces jobs, more people can find employment.

“The answer is surely not to try to stop technical change,” Summers said, “but the answer is also not to suppose that everything’s going to be OK because the magic of the market will assure that’s true.”

CEO CONFIDENCE INDEX

Chief Executive’s most recent reading of CEO confidence in future business conditions slipped from 7 out of 10 in October to 6.9 in November. It was a new low for 2018 as business leaders begin to prepare for a possible downturn ahead.

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